May 26, 2015 How Employment Rebounded in Michigan

Volume 18 | Issue 3

Job Growth in Michigan Puts the Mitten on the Map as Unemployment Drops to its Lowest in More than a Decade.

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Michigan’s reinvention is brushing away the state’s rust belt image, revealing a skilled workforce who are rolling up their sleeves and getting the job done.

Today, Michigan is experiencing its strongest job growth in more than a decade thanks to new businesses moving in or existing companies investing in their current operations, increasing their workforce and expanding their facilities.

In February, the jobless rate in Michigan had fallen to 5.9 percent, the lowest it’s been in 14 years. The unemployment rate was 6.3 percent the month before and 7.8 percent for the month of February the year prior.

Michigan went from a state with one of the lowest jobless rates in the nation at the start of the 2000s, to possessing a double digit unemployment rate during the Great Recession. The economic slowdown led Michigan to become home to the largest population of unemployed workers in the country.

All of that has changed. Last year, the professional and business services segment of the private sector in Michigan added 33,000 jobs. During that same period, 20,000 jobs were created in the manufacturing sector and 12,000 for new construction jobs. Education and health services employers added 8,000 jobs.

Easily one of the fastest growing segments for Michigan has become manufacturing, as numerous companies hire more employees and expand their footprint through renovating existing facilities, taking over empty buildings or breaking ground on new sites. Since 2010, the U.S. Bureau of Labor Statistics has shown the number of people employed in Michigan’s manufacturing sector has climbed steadily. In the last 13 months alone, Michigan has added 24,900 manufacturing employees to its workforce.

This has meant creating an environment that is too good to pass up for employers looking to relocate or expand their businesses. It also means training Michigan’s workforce so job seekers are more capable of handling the advanced work required to bring today’s innovative technologies and products to market.

The Michigan Economic Development Corporation has been working to invest in and build relationships with companies that are either already in Michigan and plan to expand or are based elsewhere and are looking to relocate. In March, three companies announced their decision to invest more than $200 million in their Michigan-based operations as opposed to taking the work to competing sites that were in and outside of the United States.

Detroit Diesel Corp. is planning to invest $208 million and create 245 jobs in its Metro Detroit operations. The investment is for plant upgrades, new machinery and equipment that will support a new medium-duty engine line to be produced at its manufacturing facility in Redford Township. A manufacturer of heavy-duty diesel engines for the commercial truck market, Detroit Diesel was also awarded a $1.3 million Michigan Business Development Program performance-based grant based upon the proposed investment.

On the west side of Michigan is DENSO Manufacturing Michigan Inc., which has announced it will add 100 jobs in a $53.6 million expansion of its auto components manufacturing operations in Battle Creek. The investment will add new manufacturing lines for advanced thermal systems; additional labs for new product testing and validation; and expand logistics and packaging operations. Denso was also awarded $640,000 in state funding via a business development performance-based grant.

Farther north is Holland Township where OMT-Veyhl USA Corp. plans to invest $8.8 million, double the size of its manufacturing plant and add 206 new jobs. Formed in 2005 by two German sister companies, OMT-Veyhl is a manufacturer of office furniture. The company was also awarded a business development performance-based grant from the MEDC for $750,000.

While manufacturing jobs continue to grow statewide, Michigan’s largest cities have also been recognized as two of the top five cities in the nation for advanced manufacturing and new engineering jobs. Detroit and Grand Rapids were named two of the hottest locations for advanced manufacturing by Change the Equation, a nonprofit organization that promotes the importance of science, technology, engineering and mathematics in schools.

The group reported a 42 percent growth in advanced manufacturing jobs in Grand Rapids and 37 percent growth in Detroit during the last five years. They expect the number of available advanced manufacturing jobs to grow even faster as the current aging, male-dominated workforce in those cities begins to retire, opening the door for younger workers and women.

These younger workers must be competent and well-trained to meet the growing demands of advanced manufacturing if Michigan is to be the leader in attracting new and retaining business.

To position Michigan as the leader in developing talent, Governor Rick Snyder recently announced $50 million in grants to 18 Michigan community colleges under the Community College Skilled Trades Equipment Program. The program was developed to close the talent gap. The grants will allow the colleges to buy equipment for educational programs aimed at high-wage, high- and middle-skill and high-demand jobs.

Since 2009, the manufacturing sector has created more than 114,500 jobs in Michigan and employers still have thousands of available positions that need to be filled. The creation of the grant program is part of the state’s plan to grow the number of skilled people in the workforce, a critical part in the push to make Michigan a place to not just find work, but good-paying jobs.

Today’s successes are the fruits that couldn’t have come from just one group or individual, but in a cooperative effort by the public and private sectors to put Michigan’s men and women back to work. We must continue to build these partnerships and expand the talent pool of Michigan’s work force if we are to go from a competitor to the leader in attracting and retaining businesses.

Steve Arwood is CEO, Michigan Economic Development Corporation.

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